HomeBuying Cost

Buying Cost

As a rule of thumb, a purchaser who does not require a mortgage should allow around 12-13% of the agreed selling price for buying costs. If a mortgage is required, allow an additional 1-1.5% on top of this. The following is a breakdown of what these costs are. With the exception of the fixed rate charges (taxes and registry fees), Alta Villas can recommend ways of reducing the costs for you! Just ask for more details.


Purchase tax on residential properties

Resale properties = Transfer tax (Impuesto sobre Transmisiones Patrimoniales  ITP)

New build = IVA/VAT and Stamp duty (AJD)*

Both are 10% of the declared sales price

*Tax on the purchase of plots is 21%


Legal fees - Between 0.5–1% of the agreed sales price is usual, or a fixed fee can be negotiated. A lawyer will charge you according to the service you require. This will vary according to the complexity of the purchase. The conveyancing services should include the changing of utilities into your name, dealing with the registry of the property and handling the payment of the relevant purchase taxes. The lawyer can also act in your absence if you give them power or attorney.

 

Property registry fees - Expenses related to inscribing the sale with the land registry are also nearly always paid by the buyer, and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate 1% of the purchase price declared in the deeds, though once again it depends upon the property and the area, and the fee could be lower.


Mortgage fees and related costs - If you buy with a mortgage then this will incur several additional costs, eg property valuation (around 500 €), arrangement or opening fees, mortgage registration fees. The fees vary according to the provider, and even according to the particular branch but the purchaser should allow between 1–1.5% of the value of the mortgage.

 

Bank fees - To pay for the property you will need to open an account in a Spanish bank to pay the relevant cheques at Notary and to transfer money from the bank in your country. The cost of transferring the money can go up to 0.4% of the amount transferred. The banker’s cheque will most likely cost 0.5% of its amount however Alta Villas can advise on ways to reduce these costs.

 

Currency exchange costs and savings - Banks will often charge to move, send and receive funds and will very seldom offer a good rate of exchange when exchanging currencies.  Alta Villas recommend the use of reputable currency exchange providers who can often save hundreds, if not thousands of euros throughout the purchase and indeed your ongoing living costs.

 

Estate agency fees - Alta Villas does not charge a Property Finders Fee! We offer a comprehensive estate agency service to our buyers to find that perfect property to purchase in Spain FREE OF CHARGE.

 

Removal costs, pet transportation, importation of vehicles, etc -  Alta Villas can advise on various ways to organise the removal of your treasured possessions and how to make savings and reduce costs.

 

Furnishing, refurbishment, decoration, insurance, security and connectivity suppliers etc - Once you own a property, if furniture is not included, you will need to furnish it. The cost of furnishing a property depends entirely upon what you want. However as a very general rule of thumb a 2 bedroom apartment will cost around 10,000 € to 15,000 € to furnish nicely if you buy everything new. Of course there is no limit to how much you can spend, though you can also get away with less than 10,000 € if you are on a tight budget (all from IKEA, for example).  Alta Villas can recommend tried and trusted service suppliers – builders, plumbers, electricians, TV and internet suppliers etc.

 

Good advice - When buying property in Spain, always keep digital and hard copies of all invoices related to your purchase. Likewise, if you ever do building work on the property once you own it, keep copies of all licences and invoices. You may be able to offset these expenses against capital gains when you sell, and so reduce your Capital Gains tax liability.

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